Delta seeks to "adjust" service in 24 smaller cities

Delta Air Lines announced today that it plans to "adjust" its service in 24 small markets "in concert with the retirement of Delta's Saab fleet and to halt $14 million in annual losses".

The Atlanta-based carrier also cited low load factors on the routes.

"As we continue to strengthen our business, Delta is retiring the Saab turboprops and some 50-seat jet aircraft, which will hinder the financial viability of serving these smaller markets," said Delta.

The carrier said it is providing 90-day notice to the US department of Transportation (DOT) about the changes in service, which will allow the agency "to select a new carrier to begin service".

Of the 24 markets, 16 receive service subsidised by the US government's Essential Air Service (EAS) programme, which was created after the US domestic airline industry was deregulated in 1978 to help preserve air service at small communities.

In other unsubsidised markets, a loss of Delta Connection service could mean they could qualify the EAS programme.

Mesaba Airlines currently operates 20 Saab 340 aircraft for Delta under the Delta Connection banner in large number of the EAS markets. Before retirements of the Saab aircraft began, as many as 49 of the type were operating, according to Delta. The remaining aircraft are slated to be retired by the end of this year, according to filings with the DOT.

Mesaba was previously a wholly-owned subsidiary of Delta until it was acquired by Pinnacle, which also owns Pinnacle Airlines and Colgan Air.

Some service is also provided by regional jets operated by Pinnacle Airlines. Mesaba and Pinnacle noted in filings with the DOT that with the DOT's "permission, Pinnacle is currently providing substitute service in select Mesaba EAS markets".

Service in one unsubsidised market, Butte, Montana, is provided by SkyWest Airlines.

Pinnacle and Mesaba noted in DOT filings that Great Lakes Airlines is interested in serving some communities, including Fort Dodge, Iowa, Mason City, Iowa, Iron Mountain, Michigan, International Falls, Minnesota, Pierre, South Dakota, and Brainerd, Minnesota.

Delta also said that it is interested in continuing to provide service "in some subsidised and non-subsidised markets, but the subsidy rate must be higher in order for Delta to fly larger regional jets on the routes in question".

Pinnacle and Mesaba in some markets plan to submit bids "to provide continued service under the EAS programme at subsidy rates that will enable us to cover the cost of the operation and a reasonable return on investment". These markets include Escanaba, Michigan;, Sault Ste Marie, Michigan; Hibbing, Minnesota; Sioux City, Iowa; Aberdeen, South Dakota; Pellston, Michigan; Bemidji, Minnesota; and Waterloo, Iowa.

SkyWest also said it intended to submit a bid for subsidised Delta Connection service in Butte, Montana.